The eurozone’s economic recovery seems to be gathering pace with strong broad-based growth, according to the latest business surveys.
This month’s questioning of company’s purchasing managers by IHS Markit revealed increased activity in the region’s dominant service industry while manufacturing also powered ahead, new orders stayed robust and hiring remained vigorous.
IHS Markit’s Flash Composite Purchasing Managers’ Index, seen as a good guide to growth, climbed to 56.7 from March’s 56.4, its highest since April 2011. A reading above 50 indicates growth.
That will be welcomed by the European Central Bank, which has been pumping stimulus into the economy for years to achieve growth and push up inflation, which it considers to have been dangerously low.
“There is a good outlook for the year – it looks like the upturn has legs. With numbers like these, people are going to start edging up their forecasts,” said Chris Williamson, chief business economist at IHS Markit.
In Europe’s biggest economy, Germany, services shifted into a lower gear but factory activity remained high.
But it was France that was the standout with business activity growing at the fastest pace in nearly six years and showing no signs of cooling down in the run up to the most uncertain presidential election in years.
“Even though on the eve of the first round of the French elections a good portion of caution is recommendable, evidence is piling up that the eurozone economy could become the positive growth surprise of the year,” said ING chief economist Carsten Brzeski.